Simple Tips, Tricks and Traps of money.
From an early age, many of us are misguided about money. Most of us believe that success will come as a result of how well educated we become and how much money we can make as a result. This could not be more far from the truth about how to achieve success. For it’s not how much money we earn that matters, it’s how much we keep. And what we then do with the money we have kept.
Even the most educated of us can easily fall into the trap of spending what we earn, or even more than we earn, simply due to lifestyle, social and societal conditioning. Not to mention the marketing machines of major corporations that convince us to buy that better, more expensive, brand of water, coffee, rice, clothing, motorbike or car. Thus perpetuating a perceived need to have things that we don’t actually need. And spending far more money than we should as a result.
The world is filled with well educated and highly paid people that, should their income stop for even the shortest time, would be on a rapid slide to becoming broke, or potential bankruptcy. This is because they have shifted their lifestyle, and their commitments, to a level on a par with their income. Higher income means taking on bigger commitments like a better home, motorbike or car loans, increased lifestyle etc. And often increasing their expenses each month close to their income level. On the surface, they look prosperous, but month to month they are just managing to survive of what they earn. Any rapid change in circumstances, such as a loss of jobs or lower salary can be disastrous.
In many cases, most people live beyond their capacity due to the availability of credit. Particularly credit cards, which are often used for items such as clothing, entertainment, holidays, and sadly, cash advances that are spent on lifestyle for a given day, yet the credit card balance often remains high for many years, if not forever. Imagine buying a new pair of trendy sunglasses that you lose a few weeks later, and then paying for those sunglasses for years because the credit card is rarely paid off.. Paying for something you either don’t use any more, no longer have or you had consumed the day of purchase just doesn’t make sense, yet so many of us do it.
The trick to better managing your money and creating wealth actually lies in understanding the difference between Needs and Wants. You Need to drink water, but often we Want a much more expensive brand that we have been conditioned to believe we Need. Confusing that which is necessary, with that which is merely a well marketed product that also has a powerful status element through social/peer pressure due to the marketing efforts of the company selling that product.
The ingenuity of marketing goes way beyond simply making a product more appealing, popular or cool. Marketing is a proven science that’s been tested throughout the world. Accessibility and visibility is paramount and therefore the placement of a company’s product in a store is critical to its success. Eg. Most children’s products in a supermarket are placed at the optimum eye level of the child. If a new candy was placed on the top shelf, the child wouldn’t see it, and therefore not start the “Mommy I Want” behaviour. Same goes for the treats at the cashier. Perfectly placed to entice children or impulsive buying adults, to Want things they don’t really Need. Dealing with everyday temptations such as these is easy. One example is to NOT TAKE YOUR CHILDREN with you when shopping. The savings you can achieve will add up very quickly.
Mentor MicroBank Foundation understands these temptations, and many other challenges, that cause us to spend far more than we should. Becoming more prosperous is most about reducing what we spend. Even someone on a small salary can becomes prosperous if they learn how. Through our free, easy to understand courses on better money management, including our many lessons about Tips, Tricks and Traps of spending, you’ll be on your way to achieving Prosperity.